Monday, September 25, 2017

Top Ten Criteria for Hiring a Consulting Firm to Help Your Small or Middle Market Business

[Editor's Note:In today's market, there are folks and firms that purport to have all the answers to issues facing small and mid-size businesses. Firms and individuals pop up with articles in local newspapers, blogs, and business magazines with all the answers. New models with fancy and catchy acronyms like RED and FAST appear on the scene. Sometimes, it is difficult for companies and business owners to determine who can really help them navigate the road ahead.

We offer the following comments about what companies should be looking for in a partner to help them realize their potential. This is a reprise of an article published several times over the years. . 
One of our long-standing clients suggested to me that it might be valuable to update it again.            -dpm] 

 Top Ten Criteria for Hiring a Consulting Firm to Help Your Small or Middle Market Business 

Focus: Beware of "one stop shop" firms that say they do everything. These include accounting firm add-ons, investment banking/M&A firms, or interim CFO firms. Accounting firms provide valuable services - audits, tax assistance, internal controls, and compliance. CFO firms provide accounting, controller, and finance functions. Investment banks/M&A firms provide a great service in the transactional work of selling your company. 
The firm you engage needs to specialize in helping companies in your size range with your range of strategic and value issues ... and have the track record to prove it!  

Most consulting firms focus on the front end (their plan and their intellectual input). Make certain you feel comfortable with the execution and their proven ability to assist you in achieving results.  

Overcoming Barriers to Success:  
Most consultants do not actually help organizations understand - and overcome - what is preventing them from being successful at the next level. Those can be tough discussions, but you can't make real progress until these barriers are addressed. 

Value: Many consultants focus on the top line (revenue line) without understanding the key drivers of value.

Flexibility - to YOUR needs:Most firms have a "one size fits all" model and they will squeeze all clients into that same model. 

Tell the Hard Truths: Most firms do not offer truly independent objective advice - they will not tell clients the difficult truths since they want the follow-on business. If it seems too good - or too easy- to be true, it usually is. There are no magic pills or magic bullets. Success in business is generally the product of good direction and hard work.

Been in Your Shoes: Most consulting firms will not have folks that have actually been in your shoes (as owners or CEOs) - and emerged successfully. It's very different when it's not your capital at risk. Ask if they have ever led a company through a period of rapid growth, weathered a downturn, or led a business through a successful sale.

Beware the "Temporary" Consultant: Beware of individuals or firms that sprung up recently. Firms with less than 5 years experience many times exist only as long as it takes for the principals to find their next full-time job, or to have their traditional business volumes return. That could leave your company in the lurch when they lose interest in you.

Talk with Their Clients - Present and Past: Talk with owners of client companies of the consulting firm. Ask them, in the end, what results were achieved. Did the consulting firm exceed expectations? Get specific about the numbers.

Aligning Their Interests with Yours: Will the consulting firm share in the risk /reward proposition with you? Are they willing to risk a portion of their fees based on your company's results?

Small and middle market companies are typically the most significant asset of the owner. They are the product of many years of tireless effort and risk. Selecting a partner who will work alongside you to help your business achieve its potential is an important decision.
What are your thoughts about these key points? Share your reactions below.
 If you would like to discuss how we might help your company accelerate the process of adding value and moving your company to the next level of performance, please contact us.

Thursday, September 21, 2017

Who Moves Your Organization Forward? Engaged vs Disengaged Employees

[Editor's Note: In 2016, I saw a startling statistic from Gallup. Of the employees in the largest 30,000 companies in the U.S., over 68% were disengaged - not connected to the objectives and goals of the organization. I was stunned, but over the years, I have come to realize that it is very true.

As companies struggle to attract and retain good employees I thought you might enjoy the following insights from Curt Coffman (author of "First Break All the Rules") about the differences between satisfied employees and engaged employees. Which type of employees do you have in your organization?           -dpm]
                                                         Who Moves Your Organization Forward?

Satisfied Employee
Engaged Employee
Lagging indicator as contribution to Shareholder Value
Leading indicator as contribution to Shareholder Value
Reactive -- "I do what I'm asked."
Proactive -- "I do what needs to be done - even if not directed to."
"That's how we do things here!"
"How can we do this better?"
"I work here" 
"I do my job." 
"I am part of the organization's fabric."     "I am not limited by a job description -     I want to make a broader contribution."
Short term focus (steps) "How should I do this?"
Long term focus (outcomes) "What result is required?"
Easy to manage -- "I go along to get along."
More difficult to manage - does more than required - pushes the boundaries
Seeks answers
Seeks results
Points out problems
Solves problems - prevents problems
Applies learning to a current situation
Applies learning to improve future situations
"What do you want me to do?"
"How can I help?" "What else can I do?"
Don't make waves - avoid conflict
Challenge the status quo - constructive conflict
Flies below the manager radar whenever possible
Demands relationship with manager
Powerless -- wait for direction
Powerful - act, then ask for forgiveness
Risk avoidant -- "I follow the rules."
Takes calculated risks -- "I bend rules as needed to achieve the required results."
"I try to do a good job."
"My work energizes me. I give it my best."
© 2006 Curt Coffman Consulting LLC, All rights reserved

"People are normally productive for about 5.7 hours in an eight-hour business day.  

But any time a change of control takes place;  
their productivity falls to less than an hour."

 If you would like to discuss how we might help your company accelerate the process of adding value and moving your company to the next level of performance, please contact us.

Tuesday, September 5, 2017

Strategic Planning is fundamental to a company's success. But, do you have a plan that your company can really execute?

At an initial strategic planning kick-off session for a client company, the senior vice president of marketing spoke up: "I've been through these strategic planning processes before at other companies. Over the course of several months, our management team would spend several days together. We put together a fantastic looking plan, then it would sit on the shelf and it was never looked at again."
I looked the seasoned executive in the eye and offered this challenge: "It's obvious to me that the CEO and management team at those companies may never have been truly committed to executing the strategic plan in the first place."  
"Oh, but we were!" he replied. "We just never converted the great strategic dialogue and consensus into strategic actions. Then we got so buried in our day-to-day duties that we never took the time to focus on executing the plan."
A good plan well executed is better than an excellent plan poorly executed.
The point is clear. To receive value for the time and money invested in strategic planning, you must employ a well-defined continuous process, execute strategic actions and routinely update and refresh your plan.
Four key checkpoints
The key to securing this value is a CEO and an executive team disciplined enough to ensure that the organization stays focused on plan execution. Value exists in the strategic process of analyzing current strategic direction and determining future strategic focus. However, this value is greatly reduced without commitment and focus to implement the plan.
Four key checkpoints can ensure that you place adequate focus on strategic plan execution during the planning and development process.
CEO commitment from the outset
The first checkpoint: determine whether the CEO and management team are truly committed not only to developing the strategic plan, but also focusing resources on executing the strategic plan. Commitment to execution is particularly challenging for entrepreneurial-minded CEOs of closely held companies who tend to be very opportunistic. These CEOs often view the strategic plan process as limiting their ability to "jump at good opportunities."In other cases, significant company-based issues may exist that must be resolved before the CEO and management team can focus on strategic plan development and execution. Regardless, it's critical at the outset that the organization challenge itself to ensure that it is truly committed to strategic plan execution and follow-through.
Validate your plans with the market
Just because you decide on a sexy new strategy does not necessarily mean that your company can be successful implementing it. It is important that you understand how customers and prospects perceive your company and that you have an honest appraisal of your strengths, weaknesses, and core competencies. Suppose the strategic planning team at Kmart were to decide to that they needed to adopt a strategy to become a high price/high service retailer like Nordstrom. Do you really think the market would accept that from Kmart?
Translating strategic direction to strategic action plans
Before preparing to initiate the strategic planning process, strategic planners often ask CEOs to produce a copy of their most recent strategic plan. Usually, a direct correlation exists between how long it took the CEO to find the document and whether the strategic plan included clearly defined strategic action steps.
Many strategic plans assess the current company situation, market, industry and competitive environment. These plans may also provide a clear strategic framework for the company. However, they often fall short in translating defined strategic direction into strategic actions. Without clear strategic actions that identify who's responsible, metrics and deadlines, it will be difficult, if not impossible, to achieve your goals.
Implementing a process for strategic plan follow-up and execution
More sophisticated organizations may implement integrated strategic execution processes. For example, the "Balanced Scorecard Approach" builds the strategic plan around key business success drivers. It links measurable corporate and business unit goals and related strategies with the performance management system. And it builds regular plan execution reporting into the process. However, some companies may not believe they have the resources to develop and implement an integrated approach. If you fall into this group, consider the following options:
  • Hold quarterly planning update sessions to review status against plan.
  • At key manager or board meetings, create a standard agenda item that requires some discussion/review of the strategic plan.
  • Report and update employees on major elements of the strategic plan. A commitment to employee communication will keep execution of strategic initiatives top-of-mind with the management team.
  • Assign a key member of the planning team to help the CEO keep execution of strategic initiatives foremost on the management team's priorities.
  • Create opportunities through strategic assessment tools that force the organization to periodically review results and performance against key strategic objectives (e.g., benchmarking, customer satisfaction surveys, etc.).
A valuable asset to any organization
A continual strategic planning process can be tremendously valuable to any organization. However, its ultimate value is significantly reduced if there's a lack of commitment and focus on implementing the plan. Make certain that you can execute your plans in order to get the real benefits.

 The Mead Consulting Group has been helping clients develop and execute Strategic Growth& Execution plans for many years. Check out our website for descriptions of some client success stories.